An Arbitration Agreement Can Save Time, Money and Stress
JUSTICE AT A FRACTION OF THE COST
Arbitration is one of the two most popular Alternative Dispute Resolution (ADR) methods. Mediation is the other. This page deals with the Arbitration process which is initiated by a written Arbitration Agreement. Arbitration is often preceded by Mediation which has an 85 percent success rate. In the remaining 15%, most litigants proceed to Arbitration instead of the court system.
THE DIFFERENCE BETWEEN MEDIATION AND ARBITRATION AT ADR
The biggest differences between the two processes are:
- Mediation is a cooperative process, a settlement prelude to Arbitration or one’s day in court. It does not replace existing legal rights.
- Arbitration is an adversarial process that replaces one’s day in court.
Arbitration is an adversarial process that entirely replaces the prolonged, arduous court system which we refer to as the House of Horrors. While Arbitration’s steps resemble those found in the court system, the process is considerably streamlined terminating the dispute quickly and more efficiently compared to the court system, and at a comparatively nominal expense. Arbitration yields a decision by the Arbitrator against one or more parties with equal weight to what you receive in court.
When people agree to Arbitrate, they are giving up the right to have their dispute heard in court, to have their case heard and decided by a jury, and to appeal the judgment
By agreeing to Arbitration, you and your opponent give up the right to access the court system, to have a trial by jury, and to appeal the judgment. In return, you receive an immediate stage to present your case and obtain a verdict.
An Arbitration Agreement Is Required for Entry to ADR
These private, out-of-court ADR platforms are not like the public court system where anyone can file a lawsuit without the consent of their adversary. Entering the door of ADR requires an Arbitration Agreement signed by you and your adversary consenting to the ADR process.
Arbitration Compared to Court
Arbitration and the Upper Civil Courts (as opposed to Small Claims) are similar in that they are both adversarial where a winner and a loser are selected, but that’s where the likeness ends.
Upper Civil Court = House of Horrors
Ask yourself, do you want to have your dispute decided in a streamlined process like Arbitration or in a House of Horrors? The decision is obvious! (Review the courtroom depiction at Alternative Dispute Resolution for a vivid depiction of the House of Horrors.)
Quick | Inexpensive | Reliable
Your typical arbitration occurs in one to three months. Done, kaput, no appeals. In the court system, it could be two to five years during which time the Litigation Arsenal (Depositions, Interrogatories, Document Productions, various motions) is active clobbering one another until they are devoured.
And, if that’s not enough, once devoured, they get to appeal the whole fiasco dragging the parties through yet another year or two of clobbering. Something like the bible story of Job, a whole new chance to get it their way!
Why wouldn’t EVERYONE choose arbitration over the courts?
This very important question is answered below. First, let’s look at the various arbitration choices.
THE VARIOUS ARBITRATION PLATFORMS ADR OFFERS
Because Arbitration is your own platform, agreed to by you and your adversary to serve as the forum for your dispute, you are in the Land of All-things-possible. Your proceedings can be in-person, online, a hybrid of online and in-person, or document-only.
In-person arbitration is the traditional route where all parties and attorneys, if represented, appear in person before the appointed arbitrator.
Online Arbitration has taken an explosive lead since the Coronavirus pandemic where being in one another’s presence was challenging to say the least. As an added benefit, the online platform frees squabbling parties, who do not want to be in one another’s presence, of in-person constraints.
Document-only platforms are best geared more toward lower-value cases ($25,000 or less) where the expense of audio-visual proceedings is not warranted. But you and your adversary can choose it as a platform regardless of case value.
CUSTOMIZING YOUR ADR ARBITRATION AGREEMENT
Not only do you get to choose your platform, but you get to set the stage streamlining the process based on the customization choices you make. Having the ability to customize your Arbitration proceeding, something you cannot do in court, makes Arbitration the clear choice of a dispute arena.
For instance, you can agree:
- To first engage in Automated Online Negotiation
- To engage in Mediation before Arbitration
- The choice of arbitration provider
- The parties will be self-represented
- The proceedings will be limited in duration
- The proceedings will be: Document-only, entirely online, entirely in-person, a hybrid
- The loser will pay the winner’s attorney fees and costs
- There will be limited or no Discovery
- To modify the rules of the Arbitration Provider
- And so forth
Take the time to set the stage for your arbitration proceeding instead of blindly walking into the proceedings without considering the many options available.
🍪 Smart Cookie Tip: If you already have an arbitration agreement and it does not include these options, they can be added now if all parties agree.
Now back to the big question:
Why wouldn’t EVERYONE choose arbitration over the courts?
Because the disputing parties don’t understand it is THEIR choice. They get disempowered and employ the Dump Truck Method unloading the dispute paraphernalia on an attorney’s desk along with their nest egg or a percentage of their potential winnings — and look the other way.
Instead, follow these steps:
- Retire the Dump Truck
- Get an analysis of your dispute with Lawsuit Analyzer©.
- If your case is a go and you have an Arbitration Agreement with your adversary, supplement your agreement with our Options Addendum.
- if you do not have an Arbitration Agreement with your adversary, prepare one and transmit it to your adversary with the ADR Transmittal Letter.
🍪 Smart Cookie Tip: Why would a potential defendant agree to a forum so their adversary can sue them? Because a lawsuit is just about to be filed where they will be irrevocably dragged into the House of Horrors, or they are in a lawsuit with you now and want a better outcome.
Can you imagine the freedom of extracting your dispute headed for the House of Horrors into a streamlined Arbitration proceeding custom-tailored by you? It’s called …
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